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I've been watching this with some curiosity for a while. With PR's recent waving of all capital gains taxes until 2038, US citizens can move there, keep their citizenship, but no longer be on the hook to pay federal or state taxes on capital gains and dividends (or at the very least, pay much less).

The new tax breaks are a radical shift in that they focus on financial, legal and other services, not manufacturing. Puerto Rico slashed taxes on interest and dividends to zero from 33 percent, and it lowered taxes on capital gains, a major source of income for hedge fund managers, to zero to 10 percent.

The incentives work with existing United States breaks. While residents still have to file a federal tax return, they do not have to pay capital gains taxes of 15 percent on assets held before moving and sold after 10 years of island residency.

The new tax incentives “likely will be considered more broadly by some taxpayers as a new opportunity for income shifting and tax deferral,” said Michael Pfeifer, an international tax lawyer at the law firm Caplin Drysdale in Washington.

With the OWS crowd complaining that the 1% are "ruining America", it would be interesting to see what would happen if the upper-income investment types simply moved. Do you believe it would make any difference? Good riddance? Fiscal disaster?

"Those who expect to reap the blessings of freedom must, like men, undergo the fatigue of supporting it."
- Thomas Paine

With the OWS crowd complaining that the 1% are "ruining America", it would be interesting to see what would happen if the upper-income investment types simply moved. Do you believe it would make any difference? Good riddance? Fiscal disaster?

Considering you can still invest from Puerto Rico I wouldn't see how it'd stop the "1%" from doing what they've been.

I'm fascinated by why Puerto Rico would want to become a tax haven, though. Seems counterproductive, and unless people have been griping, misses whatever the underlying root of them not attracting people before was. Anyway, they're doing a disservice for us all (Race to the bottom).

It was inevitable...same thing is happening in France. A lot of those "1%ers" worked hard or risked a lot to earn their money so why shouldn't they work hard to protect it?

Unfortunately, the 99% work just as hard or harder, and they don't get afforded the same protection. When the 1% "protect" their assets, it's the 99% that pick up the tab.

One has to wonder if Puerto Rico can actually accomplish this, or if they'll become another Cyprus.

"…I contend that we are both atheists. I just believe in one fewer god than
you do. When you understand why you dismiss all the other possible gods,
you will understand why I dismiss yours." - Stephen F. Roberts

They'd have to spend 75% of their time in Puerto Rico or the US won't consider it their residence and it will all be for naught.

That's what shell companies are for.

"…I contend that we are both atheists. I just believe in one fewer god than
you do. When you understand why you dismiss all the other possible gods,
you will understand why I dismiss yours." - Stephen F. Roberts

Companies are individuals. That's beside the point, you just set up a company offshore and funnel your money through it.

"…I contend that we are both atheists. I just believe in one fewer god than
you do. When you understand why you dismiss all the other possible gods,
you will understand why I dismiss yours." - Stephen F. Roberts

When the Chinese communist revolution came about, all those who could, moved to Hong Kong or Taiwan and took their 'capital' and talents with them, and those who couldn't had their property and lands confiscated.

When it became evident that France would be electing a socialist, the U.K.(among other places) saw an influx of capital from France.

When Cyprus announced those ridiculous restrictions recently, people probably started moving their capital off shore, and now with limited bank services, people will try and get the fruits of their labor and move it elsewhere.

These kinds of policies and mentality is why Apple(and other companies) do not bring their foreign earnings into the country and instead leave them offshore in places with more favorable terms. (I cannot understand why a country would want to hinder/limit/prevent people from bringing capital/wealth into the system in this way).

There's no need to even look that far across the globe. Look at what is happening in the tech industry between California and Texas as an example.

For examples of what could/would happen with the opposite approach:
-Look at Estonia and the path they chose through the 90s after their departure from the Soviet Union.
-Look at India as it moved away from central planning in the 80s to today.
-Have a look at China since it moved to a more capitalistic system.

The specific benchmarks to observe(which interests me anyway) is the change in the standard of living and the size of the 'middle class'..